Expats’ tax liabilities for work performed online or over-the-phone in Mexico comes up over and over on forums across the web. The situation becomes even more interesting if they live here full-time, doing online work for a non-Mexican company, and receive their pay in foreign (non-Mexican) accounts. This ball was most recently kicked-around at length on a Mexconnect thread, "Tax Liabilities in Mexico."

At first glance there appears to be a conundrum between: Hacienda’s policy that worldwide income must be reported by expats whose principal place of activity is Mexico and INMs policy for (not?) giving visas to expats work online and live in Mexico, who do not work for Mexican employers and receive their pay outside of Mexico.

Here’s one more perspective on the issue: I spoke with a Merida INM supervisor today about these specific issues, and she made a phone call to her manager to check on her understandings. She then said that:

1. INM would issue this person a "No Inmigrante Visitante Otros – No Lucrativa" FM3 visa/permit.
2. No taxes are owed to Mexico.
3. The expat should not register with Hacienda.

She then gave me the following written instructions for an INM application for the "No Inmigrante Visitante Otros – No Lucrativa" visa/permit:

1. Register your INM application online at the "Solicitudes de Tramite" website.

2. Choose "FORMATO MIGRATORIO PARA TRAMITES DE ESTANCIA"

3. Under "QUE DESEA HACER": Choose "Realiza actividades diferentes a las autorizades"

4. Complete the online application, and bring a copy of the printed final form that shows your Pieza Number, to your INM Office.

5. Bring passport & copies.

6. Bring a comprabante & copies of your residence (CFE or Telmex bill), your original "forma migratoria vigente," your "comprabante de pago de derechos por recepcion, examen y esudio de las solicitud, si las caracteristica del extranjero es la de turistica … $491.00" for expats who have just entered Mexico on a tourist visa.

7. Bring "El pago de derechos correspondiente al otorgamiento de la nueva caracteristica por adquirir debera realizarse al momento de tramitar la expedicion de la forma migratoria. Comprabante de pago de derechos. Actividades No Lucrativas: $1.294.00, con fundamento en el Articulo 8, fraccion II, B) de la LFD"

8. and: "Las cartas deberan estar bien especificadas que su salario lo recibira en Estados Unidos."

The supervisor said they would gladly issue an "No Inmigrante Visitante Otros – No Lucrativa" FM3 – visa/permit to a foreigner who met these requirements.